The Pros and Cons of 4 Super-Duper Cheap Home Phone Plans

by Chris Tecmire

Home phone plans seem old fashioned these days. Plenty of folks just rely on their cell phone for everything. And there’s some merit to that. If you’re one of those people that feel it’s blasphemous to have anything less than an unlimited talk, text, data, and whatever-new-gadget-Apple-can-come-up-with plan, why spend more money on a home phone when you already have a phone by your side at all times?

However, if you are anything less than a hard-core cell phone junkie, super cheap home phone plans can still serve a very valuable service. My wife and I have a cell phone as well as a home phone and spend less than $10/month on the two phones…combined. In fact, my total phone expense for 2012 was only $82! We save the cell phone for emergencies as well as quick calls when one of us is away from home. No long, philosophical debates or sappy, romantic poems allowed on our cell phone! Functional phone calls and necessary questions only. The home phone is used for everything else. It is our main source of communication with the outside world because there isn’t a cap on how long we can chit-chat.

Remember, even the cheapest unlimited cell phone plans cost AT LEAST $30/month. However, the cheapest “unlimited” home phone plans cost somewhere between $0/month and $15/month. That’s substantial savings! That’s why I canceled my normal cell phone plan a few years ago and started using a bare-bones emergency cell phone along with a cheap home phone like the ones detailed below.

Important Note: All 4 home phone plans detailed in this article rely on VOIP (Voice Over Internet Protocol) for their connection, meaning you’ll need high-speed internet at home for them to be effective. Don’t consider VOIP if you’re still wrestling with dial-up. A decent DSL or cable connection should be enough, but if you’re not sure, most VOIP companies offer a short trial period where you can see for yourself and make sure it works in your home.

The Pros and Cons of VOIP Phones

Let’s first look at VOIP in general before we take a closer look at the individual options. Again, VOIP is just a phone service that relies on a signal from your high-speed internet connection. The vast majority of the devices these days are quite simple to set up. They provide a device that gets connected to your router with one cable and the base of your phone with another. Your computer doesn’t have to be on for the phone to work – the internet connection just has to be available. So, if you lose your internet connection, your phone signal is also gone. That’s where a good emergency cell phone comes in handy.

Pros:

Super Duper Cheap!

Usually simple to set up

Can often use the home phone you already have

Cons:

Clarity of calls isn’t as good as a landline (somewhere between a cell phone and landline)

Possibility of dropped calls or glitches – similar to cell phone service

4 Super Duper Cheap Home Phone Plans

This is the one that Trisha and I have. We signed up a few years ago when the “plus” version first appeared. I had tried the original Magic Jack before that, but it was incredibly annoying to have to keep your computer on constantly (the phone plugged directly into your computer). So, once the Magic Jack Plus came along and it allowed you to simply plug into a wall outlet instead, I gave it a try and we’ve stuck with it ever since.

This is the only device on the list that I have personally tried. It has worked fine for us, but the reviews are split right down the middle. Half of the people sing their praises and half absolutely hate Magic Jack and act as though Osama Bin Laden invented it.

So, you won’t be getting any “take it to the bank” guarantees from me. We have experienced occasional static or dropped calls, but it hasn’t been any worse than a decent cell phone reception. In my mind, it’s been well worth it though. We spend $40/year (we kept Trisha’s old cell phone number), which is less than some people spend per month. That’s a big deal.

The cost structure of Ooma is a little different than the first two companies. Ooma markets itself as a one-time charge and then free phone service for life. Meaning, you pay for the device and then that’s it. That sounds wonderful, but most of the reviews that I’ve read state that they have to charge local and state taxes for the service, so you actually end up paying somewhere between $4-$8/month after all. While that still doesn’t seem like much, the annual fee that I pay to Magic Jack works out to be around $2.50/month and I’ve never paid any taxes. So, it may end up more expensive after all.

However, with that being said, the reviews for Ooma are much better than Magic Jack or Net Duo, so maybe it’s worth it…

Cost:

$140 initial cost and then local and state taxes ($4-$8/month)

$40 initial charge to keep your old number, but no ongoing annual charges

The reviews say that Ooma is superior to Magic Jack or Net Duo. Since I’ve never tried it, I can’t tell you for sure. Their website talks a lot about their “crystal clear” clarity and its superior technology that allows it to use less bandwidth. It’s fairly convincing, but it’s also just a company trying to get you to buy their product, so exaggeration is expected. Either way, if keeping that landline quality voice clarity is most important to you, Ooma may be worth a shot. Like most of the other VOIPs, there’s a 30-day money-back guarantee.

The Obi device is not tied to a phone service, so you have to register for a VOIP service like Google Voice along with buying the device. That sounds like a disadvantage but, in reality, Google Voice is currently FREE. So, once you buy the Obi100 (only $40!), you’re done. Close your wallet or purse up and forget about it. That’s a big deal.

It’s always possible that Google will decide to charge for their service at some point in the future, but, at least for 2013, it’s free and there’s no evidence that it’ll change any time soon.

Can’t transfer a current home phone number (see below for more on this)

Bottom Line:

The name alone makes me want to buy it. Obihai Obi100 – you can’t beat that. If Magic Jack Plus starts to fail me, this may be the one we try. It’s the cheapest and it has the best reviews. That’s a great combination.

However, there are some small downsides to using Google Voice with the Obi. The fact that 911 service is not available is a little frustrating, and keeping your home phone number is more difficult than with the others. A cell phone number can be transferred, but your home phone cannot. So, basically, you need to transfer your current home phone number to a mobile phone and then transfer it to Google Voice.

Also, the set up may not be quite as simple as some of the other systems since it involves two different companies, but there are plenty of videos and tutorials online to show you how. So, while it may be slightly more “techie” than Magic Jack or Ooma, it’s not brain surgery.

November 2013 UPDATE: According to Obihai’s blog, the device will no longer be compatible with Google Voice as of May 15, 2014. Click the link for more information.

Others To Consider

There are LOTS of VOIP phone services on the market these days. New companies pop up every month and the big companies continue to try to top each other to gain market share, so feel free to search for better options.

Straight Talk is one that gets a lot of attention. It is actually not a VOIP since you don’t need an internet connection to use it. Straight Talk relies on a wireless connection much like a cell phone, so they recommend that you place the unit near a window. You may have to search for the sweet spot. It’s considerably more expensive than most VOIPs at $100 initial cost and $15/month, but if that’s still significantly less than what you pay right now for your landline, it may be worth a shot. Check the reviews and determine whether it’s worthwhile for your situation.

Basic Talk is a new service from Vonage that’s sold at Wal Mart. The upfront cost for the unit is often waived, but it’s $10/month (plus taxes) after that. It is a normal VOIP like the others we’ve looked at, but is more expensive in the long run. There aren’t as many reviews for Basic Talk since it’s the new kid in town.

What service do you use? Do you have any home phone wisdom for the Simple Family Finance readers?

My solution for my daughter was grooveip and an old android phone. The app was 3 bucks at the time and uses google voice. It does outbound calls for free. You can also do inbound for free with other apps. Is it a PITA to set up?…….most defiantly……Is it dirt cheap?…..most defiantly…..does it work?….most of the time…

Being cheap has its limitations. I use tmobile for my wife and I. I was going to go prepaid for the phones and bought 2 phones. I called to cancel my “normal” tmobile account and go prepaid. They offered several discounts to keep me on month to month. 70 bucks for unlimited text, unlimited data and 1000 minutes for 2 lines.

Is there a cell phone out there, prepaid, that doesn’t doc minutes when not in use? We used to have one and we rarely used it, but the minutes would get eaten up even when not in use. Thanks for your review on the Magic Jack. We are considering it currently.

The issue these days with prepaid phones/cards is not as much that they doc minutes when not in use, but that the cards expire. So, you can’t just sit on your minutes. I don’t know of any companies off hand that offer minutes that don’t expire. It’s their way of getting you to come back and spend more money. The key is just finding the best package of cheap minutes and long expiration dates. That’s what I tried to do with the options in this article. We just switched to one of the cheap AirVoice plans and it has worked pretty well so far, but it’s only been a month or two maybe. PlatinumTel is another cheap one.
With Magic Jack, make sure you pay attention to the clarity and reliability of the line during your trial period to make sure it will work well in your area. It’s different for everyone. Good luck!!

I have my cell phone just for an emergency or a text or call while I’m out and about, so I don’t have a high usage. I’ve been using Net 10 for about 7 years now and I’ve been happy with it. I do the monthly easy minutes plan which is $15 a month for 200 minutes and those minutes ROLL OVER each month. They have a larger easy minutes plan but this one works for me. Easy Minutes means they do an automatic charge for your minutes using a credit or debitcard. It’s the only plan of theirs that has a roll over, but they also have unlimited service that is $50 for 30 days for people that use their phone a lot.

My husband and I use Pageplus for our cell phones. They run off of verizon towers so service is great. For a basic phone you can get 200 minutes for $10 which is good for 4 months. Making that around $30 a year per phone.

If you are on the month to month low price plan (10.00) with Tracfone unused minutes do rollover. So if you are just using for emergencies and quick calls it is good, if you use a bit for talking and a lot of calls not a good deal because it does not give you very many minutes with that plan.They sell certain phones that “double” your minutes or “triple” your minutes for the life of the phone.

TracFone minutes never expire. They always roll over and no minutes are eaten up when the phone is not in use. When I bought my phone at Walmart, I got double minutes for life. Now they are selling triple minutes for life.

Tracfone minutes DO expire as in my experience of past couple of years. The more you spend, the more minutes you get and the farther in time the expiration date. Just pay attention to what you purchase. You could also pay to have your minutes valid for 1year.

I just bought Basic Talk online. The modem and shipping were free. The price per month is $9.99 plus taxes and fees. I believe my first month’s bill was $12.22. I am concerned about their “normal usage” for unlimited minutes. What does that mean? They are figuring what normal “unlimited” usage is and charging you extra if it is over that number of minutes? It is a month to month plan, no contract, so if I find I get charged for extra minutes on my “unlimited plan” I am going to look for a service who really means UNLIMITED.

I’ve had stimobile.com for yrs, as a pre-paid cell, pay 9 cents/day for right to use, then 9-12cts per minute, as needed. On Sprint system, which is good in urban areas & along major highways. I’ll add $25, not have to add for months if I’m not traveling much.

Lauren, if you go to their website and click “buy now”, the price of the box is X-ed out, meaning it has been waived. Here’s the address to the website I’m referring to. http://www.basictalk.com/how-it-works?

I have cell phone service that is prepaid i pay total of $87 a month for 3 lines on mine it is $39fir unlimited. Talk, text,and internet, the second $29 for talk &text unlimited the third $19 for 200min and unlimited text it also give calls to several. Countrys included in the price plan,i have had there service for over a year niw and love it givin it does run off of. Tmobile as a resell service it has workrd and i can not beat the 3lines for $87 a month the name is ultra mobile i came across it in a stire called rancho markets here in utah

In telecomunication you need best and better voice quality to listen incoming voice from other speaker and vice versa this will only happens when you are taking better services from good service provider. we the telesystemscorp are committed to give you best services in voice and data cabling services.

Don’t do Basic Talk phones at Walmart, sold by Vonage. You can’t take the phones back, vonage buys them but it is not 9.99 next month like they promised. It is 18.02 a couple days later even if you have not plugged in the phones. It took me a week of 7 calls, one hold for 15 min. no one came on, and one for 1/2 hr. no one came on, both in Acct. Management, who are in the customer service office but the rep. cannot transfer you to them. You go to an outside service. Get the name and confirmation number if you cancel! Eventually 1 week later I found you have to call at 7:30 A.M. to get service who gets on the phone.

If you can get a friend to give you their old Verizon branded smartphone, you can have it all for a flat 12 dollars a month, that is IF, by all you can make do with 250 minutes, 250 texts, and 10MB of smartphone data for the occasional search per month. KittyWireless.com has FREE Page Plus Activations (they’re a Verizon Network reseller) and you get 2 dollars worth of service to make sure your phone works before you purchase their “12″ plan. If you’re reading this in the month of December 2013, they’ll even give you your first 12 plan free too. Best deal I have found for this original (vintage 2009) Droid phone.

I don’t have this phone, but recently ordered a Samsung Centura Tracfone with plans to use wifi calling while at home. Am I too in trouble, or will I still have alternatives like Skype and stuff when the Google VOIP issue kicks in in 2014? So far can’t find any other info, and I’m too new to VOIP (as in haven’t used it besides in Gmail) so far. Any feedback would be appreciated – thanks!

Both Tracfone and TMobile prepaid give a one year expiration for $100 prepaid cards (as opposed to 30, 60, or 90 days for lower amounts). Don’t use the minutes in a year? They’ll roll over with purchase of a new card. I’ve been making one card purchase a year for, well, years.

I have been looking for reviews of Simple Phone Company (which is how I found your now-bookmarked site). They offer a little doodad that looks like the Basic Talk device, and the price looks right. I think I’ll try it.

Two other options people may consider: First, Scratch Wireless has “free” cellphone service that uses WiFi and you can add cell if and as needed. The cellphone add-on prices are so-so but probably ok if they’re rarely needed. The other option is Republic Wireless, which operates in a similar fashion by utilizing Wi-Fi first. Both options are somewhat hampered by the purchase price of the special phones (although the cost would be amortized over time).

Enjoyed the post and to browsing through all the accumulated wisdom I’ve missed.

Have you indeed tried the Simple Phone Company device as of yet, Keith? If so, how do you rate it thus far? I’ve been trying to find some reviews for it as well, as it looks like a potentially good deal if everything is aboveboard. Please give us your opinion if you have indeed followed up on your plan to try it!

Kevin I know your post is over a year old but if you see this I’ve a question about BasicTalk. The fine print says normal usage constitutes as 3000 minutes per month and TWO other things listed(can’t recall them now)from their list.
Since you had the service did you have a cap put on your monthly usage? In other words if you went over 3000 minutes(if you were keeping track lol)did they restrict service?
I’m asking because I bought the box in store&activated then saw the fine print. Now I’m a bit confused&concerned what “normal usuage” is. Seems to me it (normal usage)varies from person to person/situation to situation.
Thanks

I have the Obihai in my office and while it’s useful to have voicemail on, the clarity is terrible. I can always understand the people on the other side but no one can get more than one or two words I say at time without cutting out. If you need a phone to not make phone calls it’s fine but otherwise…nope!

Recently purchased Basic Talk from Walmart thinking my monthly payment after the first month would be $9.95. With local, state, and fed taxes it will be 14.68 starting around 3/1/2014. That is almost a $5.00 difference. So far, only 1 of several people have problems hearing me and I them. It cuts in and out with that person. I still have a few more days under the 30 day warranty. Thank you for the informative info regarding various voips. I tried Magic Jack (2-3 years ago before Plus) and was not pleased. Had a lot of problems.

I have been using OOMA for about 4+ years and have had NO problems with the service. No one has ever been able to tell that I am using VOIP. The clarity is BETTER than a land line. I can take my box anywhere I travel on vacation and if there is a solid internet connection use it there. My cost total is $3.73 without the premier service or $13.73 with it. I highly recommend it to anyone with a good internet connection.

I’ve been using /magic jack it’s great although it drops calls after about an hour. Something that is a blessing because after an hour talking with elderly folks you can barely get a sentance in anyway. It’s nicer than to just have to come right out and tell them you have to get off the phone. Recently the city of Houston has been trying to bill Netflix Over the amount of monthly useage charging for a 911 fee. So I just putthe regulaer 911 number for police/fire on speed dial. Plus with MJ you get free long distance and caller ID a s well as voice mail. AT&T can kiss my $45 dollars a month goodby. The problem being that the government will soon start taxing the hell out of these services due to lack of their cash cow that AT&T used to provide. Over half my old bill went to BS line charges and tack on fee’s and taxes.

I googled lots of sites and complaints but no one mentions these facts. My services are bundled so I get phone service for $30 a month with Verizon Fios. if I drop phone service and just keep internet the price will more than double for Internet. its cheaper just to stay in the bundle. the same with the local cable company. this is their way of keeping people from going to MJ, ooma, etc. they have teaser rates for new customers that expire in a year then you’re paying regular high rates again. no deals for existing customers. You have to compare apples to oranges and what works in your area. Its all a monopoly and gamble with services.

I had Vonage for years and then switched to Ooma to save money in the long run. Ooma works ok, but you get what you pay for. Vonage call quality was always great (better than a landline). Ooma was not what I had expected after having Vonage. It doesn’t even come close to the call quality of Vonage. There seems to be a delay and is not as clear. Since basictalk is a Vonage service I am assuming that the call quality would be the same. I will however stay with Ooma for some time since I already paid for the device and am now only paying $3.76 a month.

here’s a question, no one seems to be able to answer. If I get the basic talk, will I have to cancel my land line, and if I am bundled with cable TV, do I have to let them know I am cancelling my phone service, or do I let my phone service know, as they are bundling with cable TV, and that’s where my bill comes from?

If you are referring to keeping/porting your nbr, No. Do not let your bundled company/service know. They might try to intercept it and if you cancel or get rid of that line before you port out it is no longer yours so it will not go through. Just let them handle everything with the porting and after it is done, I believe the service cancels. From my experience porting out my old cell nbr the phone was unusable but it was a prepaid phone so I dont know about contracts. My mom, on the other hand, let the phone company know and they basically advised her to cancel the service (which is weird), so when she went to port, the nbr wasnt hers anymore and it didnt go through. So keep it as is, let the new service deal with it and after its done check your bundle.

My husband and I each have a Samsung Gallaxy 4 Android tracfone. We purchased through HSN for $129.00 each. We get triple minutes..data…and text for life. No contract. No data used at home with our wifi. Only have to spend $19.99+tax every three months and everything rolls over.I love this phone. Also came with house and car charger and cover. We also have the landline at home with a bundle pkg through Time Warner…phone…cable…internet. I am not 100% happy with .TW though…too expensive and would like to look for something else.

I was going to order Basic Talk I was told that after 3 to 6 of paying $9.99. I would have to go on Vonage phone service. So I would have to pay $24.00 a month after that. I am on a fix income and I though it would be great. I do not what to have to pay $9.99 for a few months and than have to pay $24.99 plus tax and fee that could be over $30.00 I feel I would not be saving anything. I would like to know why Basic Talk does not said this in they Ads. I hope to hear from them soon about this.

You can make the cost of calls cheaper if you have a wifi capable phone or tablet.

Free apps are available that let anyone make free outgoing calls to any phone within the US, and receive inbound calls from a user of the same app, over any accessible wifi connection. Depending on the app, your wifi calls may be able to be caller-IDd with your cel or home phone number.

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I’m considering OOMA or StraightTalk. The question is – can you connect your home phone system into their home phone adapters? I have multi-phone cordless base stations – would like to keep the convenience of a phone in every room.

I have been using Basic Talk for about 2 years; same number in KY & FL. Problem w/ BT is sometimes incorrect information sent when other party wants me to press my keyboard to send information such as prescription Numbers. This causes problems.

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